It was a choppy day and nifty held 5700 zone but only options writers could benefit from these kind of range bound sessions. If we have a look into the stock specific data stocks like BATA India, SBI and Reliance Capital are heading down by breaking important support zones. Bank nifty is still holding some important levels due to banks like Axis bank , ICICI bank and YES bank. As said in the previous post I would be holding my short positions in BATA and SBI as the view is negative in the medium term. World market charts are out of the basic bull market pattern of higher top and higher bottom formation and it would be a worrisome picture for Indian equity market.Thus put options can be bought in PSU banking space and metals as these are the weaker names in the market and wait for a deeper cut to get into mid cap names like Wipro and LIC housing. The strategy should be to book longs in stronger names like L&T , ICICI bank and Axis bank as there is no point in creating short positions in these stocks and try creating short positions in the mentioned names if they are breaking down. Volatility and turnover data are showing addition of new short positions in nifty with some cash based selling too. I would like to maintain a bullish stand in dollar index for a target of 81.5 and it is wait and watch game for nifty whether it is holding 5630-40 zone.
